Gold Steady as Markets Await Fedspeak

Written by Staff Writer

gold 2048287 640Gold steady as markets await Fed clues on rate outlook -Reuters
"Gold prices were little changed on Tuesday as traders largely remained on the sidelines, awaiting a widely expected cut to interest rates by the U.S. Federal Reserve this week and a steer on its longer-term plans.

'The market is searching for a new catalyst ... The 25 basis point rate cut is relatively priced in already, but what traders are really looking for is forward guidance,' said Phillip Futures analyst Benjamin Lu. A quarter-point cut to U.S. interest rates is widely expected when the Fed issues its next policy statement on Wednesday. It would be the central bank’s second such cut after lowering rates in July for the first time since 2008....The Fed's language and new economic projections will be examined closely, given the backdrop of a bruising U.S.-China trade war, stimulus by the European Central Bank and a stream of weak manufacturing data that hints at larger potential problems for the United States....Attacks on Saudi Arabia's main oil refinery at the weekend have also entered the equation, prompting U.S. President Donald Trump to apply more pressure on the Fed to lower interest rates. 'It appears conviction remains positive so long as gold hangs around $1,500,' AxiTrader strategist Stephen Innes said in a note, adding that the market has been caught between hedging against a possible U.S. military response on Iran and position-squaring ahead of the Fed’s two-day meeting"